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A Better Singapore:

Quality Growth, An Inclusive Society

Budget In Brief  

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A Better Singapore

We are transforming our economy so that we can have

Quality Growth - growth that will provide

all Singaporeans a better quality of life.

And we are taking further steps towards a more

Inclusive Society - starting with our children, helping lower-

income workers, and providing better lives for our retirees.

Budget In Brief 2

“We all hope Singapore will always remain the best 

home for ourselves, our families and our children.”  Prime Minister Lee Hsien Loong

Chinese New Year Message 2013

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Budget In Brief 3

The Quality Growth Programme aims to help businesses upgrade, create better jobs,

and raise wages. We will:

Tighten Foreign Worker Policies

Provide a 3-year Transition Support Package Strengthen Productivity Incentives

Develop Capabilities for New Growth Industries

To continue moderating the growth of the foreign workforce, we have to make further policy

adjustments in different sectors to reflect the circumstances of each sector:

Raise foreign worker levies for all sectors

Further selective Dependency Ratio Ceiling cuts

Tighten eligibility requirements for S Pass and Employment Pass

Tighten Foreign Worker Policies

Restructuring for

Wage Credit

Scheme

CIT

Rebate

PIC

Bonus

The 3-Year Transition Support Package provides

$5.3 billion worth of support to businesses. This

will help them restructure and share productivity

gains with their employees in the form of higher

wages. 

3-Year

Transition Support Package

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Budget In Brief 4

Govt Co-

Funds 40%  $80  $160  $240 

Gross

Monthly

Wage

Increase

2015 

$ 200

$ 200

2013 $ 200

$ 200

2014 $ 200

$ 200

Under the Wage Credit Scheme

(WCS), Government will co-fund

40% of wage increases for

Singaporean employees over the

next 3 years. This will help

businesses raise the wages of 

their employees.

It will apply to wage increases for

Singaporean employees earning

up to a gross monthly wage of 

$4,000. The WCS will cost

$3.6 billion over 3 years.

The Productivity and Innovation Credit (PIC) Bonus encourages more companies to take

advantage of the PIC scheme to invest in productivity. Businesses that spend a minimum of 

$5,000 in PIC activities in a year will receive a dollar-for-dollar matching cash bonus. The bonus

will be up to $15,000 over 3 Years of Assessment (YA2013 to YA2015). It will be paid over andabove the existing PIC benefits, and is expected to cost $450 million over 3 years.

Business makes

$10,000 PIC

Investment

PIC Bonus

$10,000

Existing

PIC Benefits$40,000 tax deduction

OR $6,000 Cash Payout

 N E  W 

Wage Credit Scheme

A Corporate Income Tax (CIT) Rebate of  30% of tax payable capped at $30,000 per Year of 

Assessment will be given to help companies cope with cost pressures. The rebate will be for 3

years (YA2013 to YA2015).

PIC Bonus 

Illustration 

Illustration 

Corporate Tax Rebate 

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5 Budget In Brief 

Make it easier and faster for businesses to makePIC claims

Introduce a Land Productivity Grant for

companies that intensify land use in Singapore

Link SMEs with research and technology

partners

Broaden and enhance the Partnerships for

Capability Transformation (PACT) scheme 

Develop solutions to industry-specific

productivity challenges through the

Collaborative Industry Projects  Promote prefabrication in construction via the

Integrated Construction and Precast Hubs 

Strengthen Productivity Incentives

We will develop capabilities that enable us to seize opportunities in

Asia’s rapidly growing economies. We will support: 

A Future of Manufacturing plan ($500 million over the next 5 years)

The emerging satellite industry ($90 million for the Satellite Industry

Development fund)

Capabilities for New Growth Industries

We will make it easier for companies to tap on schemes, help them upgrade and support industry

-wide collaborations through the following:

A 1-year 30% road tax rebate for goods vehicles, buses and taxis will be granted. The

rebate will take effect on 1 July 2013 and save businesses $46 million.

Currently, when commercial vehicles reach the end of their 10-year COE, the owners

can only renew for 5 years with no further extension, or pay more for a 10-year

renewal. We will allow owners who choose to renew their COEs for 5 years in the first

instance to extend their COEs further for another 5 years. This will ease their cashflow

and provide more flexibility.

Cost Savings for Commercial Vehicles

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6

To ensure all Singaporeans share in the fruits of progress, we will:

Promote social mobility

Sustain a fair and progressive system of taxes and benefits

Strengthen social safety nets

Provide direct assistance for cost of living

Inclusive Society

Budget In Brief 

Promote Social Mobility

We will take further initiatives to strengthen opportunities for lower- and middle-income

pupils in our education system.

We will more than double our spending on the Pre-school sector over the next 5 years

to more than $3 billion. This will allow Government to:

Building A More

Extend learning support programme

beyond the early primary school years

Significantly expand the number of school-

based student care centres

Develop rich online materials to provide

additional support for students

Expand Opportunity Fund by $72 million -

40% more for schools and extend it to

Polytechnics

Top up Edusave Endowment Fund by $300million

Expand capacity so that more pre-schools

centres are closer to homes and workplaces 

Bring more operators onto the Anchor Operator

scheme, providing 16,000 more places by 2017

Build up teacher quality with salary grants,

scholarships and training grants

MOE to set up a few kindergartens to developbest practices 

Establish an Early Childhood Development

Agency to drive improvements across the entire

sector

At the school level, we will also provide more support for disadvantaged students. This will

help them catch up and better build a foundation to do well later in life. We will:

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7 Budget In Brief 

Increase WIS payouts Maximum WIS payouts will rise by 25%-50%,

or up to a maximum of $700 for workers aged

45 and above

Proportion of cash to CPF will increase to

provide more help to workers with immediate

expenses  Higher payments to CPF Medisave and Special

Accounts to help boost healthcare and

retirement savings of our older low-wage

workers 

A 60-year old worker

earning $1,000 a month will:

Receive a total of $3,500, or

3.5 months of additional

income, in WIS per year

Of this, $1,400 will be paid in

cash, which is more than

$100 a month

Expand Workfare Income Supplement (WIS) coverage Monthly income ceiling will rise to $1,900 a month, which will benefit about 480,000

Singaporeans, or 30% of our citizen workforce 

To help low-wage workers save more for

their retirement and medical needs, we will

also restore employer and employee CPF

contribution rates for workers who are

earning less than $1,500 a month.

Everyone contributes something to Singapore, but the

bulk of taxes are paid by the high-income group and the

bulk of benefits are received by the lower-income group.

In this Budget, we will add to the progressivity of the

system, including enhancing Workfare significantly to

help older workers. We are also reinforcing our social

safety nets.

A Fair & Progressive System of Taxes & Benefits

Strengthen Workfare

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For Non-Owner-Occupied Residential Properties

An economy car with an OMV of up to $20,000

will see no change in ARF rate

A car with an OMV of up to $50,000 will pay up to

$12,000 or 24% more ARF

A luxury car with an OMV of $75,000, for

example, will pay $32,000 or 43% more ARF

Budget In Brief 

For Passenger Cars

There will be:

No change in property tax rate for 112,000 or 67% of properties

Higher property tax rate for the top 33%. The increase in property tax

will only be significant for high-end investment properties.

The new tax structure for residential properties will be phased in over 2

years from 1 January 2014. 

For Owner-Occupied Residential Properties

We will enhance progressivity of the tax structure through:

Lower property tax rates for 950,000 or 99% of homes

Higher property tax rates for the top 1% of homes. The increase in

property tax will be small except for those at the very top-end.

The Additional Registration Fee (ARF) is currently 100% of a car’s Open Market Value

(OMV). This will be replaced by a tiered structure, where more expensive cars pay higher

rates.

More Progressive Taxes

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Senior’s Mobility and Enabling Fund Top up to $50 million

Help seniors purchase a wide range of assistive devices like hearing aids

and motorised wheelchairs

More Help Under the Public Assistance (PA) Scheme A couple will now receive $90 more per month, or $790 in total

Supplements the free services that they already receive, such as medical

treatment in polyclinics and restructured hospitals, and other social

services

Review of Healthcare Financing

We will keep healthcare affordable, especially forolder Singaporeans.

We will review how the out-of-pocket share of 

medical costs can be reduced, even for the middle-

income. We also want to broaden insurance coverage

and increase the role of Medisave. 

Improving Social Service Delivery Set up 20 new Social Service Offices in HDB towns to coordinate support

to needy families

Integrate eldercare services under one agency to better serve our seniors

Dedicated agency to strengthen focus on persons with disabilities 

9

Pensioners to Get More Raise Singapore Allowance to $280 per month Increase monthly pension ceiling to $1,210

These changes will benefit 10,000 Government pensioners

Budget In Brief 

Top up to Medifund and Eldercare fund $1 billion top-up to Medifund to provide extra assistance with healthcare

bills, including to middle-income families

$250 million top-up to Eldercare Fund to strengthen support for patients

in nursing homes and other long-term care services

Stronger Social Safety Nets

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Extra GST Voucher 

10 Budget In Brief 

Personal Income Tax Rebate For Year of Assessment 2013

30% rebate, capped at $1,500 for resident

taxpayers below 60 years old

50%, capped at $1,500 for those aged 60

and above

Lower Concessionary Foreign

Domestic Worker Levy For families with young children,

elderly dependents and persons

with disabilities

Levy reduced from $170 per month

to $120 per month

A family will save $600 a year

From 1 March 2013

Direct Assistance for Cost of Living

The Government will provide $1.7 billion to help households cope with cost of living.

Rebates on Service & Conservancy

Charges (S&CC)

$200 CPF Medisave Top-UpFor all Singaporeans aged 45 and above

Many Households will Benefit

Retiree Coupleliving in 3-room HDB 

Middle-Income Familyliving in 4-room HDB 

$3,000 in benefits, 

of which $1,400 in Medisave 

$1,500 in benefits

This includes the one-off GST Voucher Special Payment, S&CC rebates, CPF Medisave

Account Top-Up, Personal Income Tax Rebate (for the middle-income family), tax

savings, and the permanent GST Voucher. 

Total payout of Cash, Medisave

and U-Save benefits will be

doubled this year All HDB households will

receive rebates of 1 to 3

months based on flat type